Sponsored by ADP Small Business Services, CompuPay, Inc. and Paychex

Driven by
massive regulatory and technological changes, finance and accounting
professionals are grappling with a tidal wave of change and
complexity in payroll and employee benefits.

To
gain some insight into the issues and opportunities, the Journal
of Accountancy gathered several leading executives to join a
virtual roundtable discussion. Here, they talk to Editor at Large
Rick Telberg about the new regulatory landscape, changing
technologies, and how they and accounting professionals are seizing
new advantages amidst change.

Regina Lee, President of Major Account Services and Small
Business Services, ADP Inc. A 28-year veteran of ADP, Ms.
Lee has held numerous senior-level positions, most recently serving
as President, ADP National Account Services and Employer Services
International, where she led an organization of 13,000 associates to
offer human capital management outsourcing services to the largest
organizations worldwide. Visit ADP.com

Charlie Lathrop, Chairman, CEO and President,
CompuPay. Mr. Lathrop joined CompuPay in 2005 and, with a
focus on organic growth and acquisition, has more than tripled the
size of the company, currently the fourth-largest payroll provider
in the U.S. Prior to joining CompuPay, Lathrop was CEO of
Advantage Payroll Services, where he took the company from $12
million in annual revenue in 1997 to more than $75 million before
managing the sale of the company to Paychex in September 2002.
Visit CompuPay.com

Delbert Humenik, Senior Vice President, Sales and
Marketing, Paychex Inc. Prior to joining Paychex in
September 2009 as a member of the company’s executive team, Mr.
Humenik was senior vice president and general manager for R.H.
Donnelly Corporation (now Dex One Corporation), a leading national
Yellow Pages and local search company. Additionally, Mr. Humenik’s
20-year sales and marketing career includes sales management and
executive leadership positions with Verizon Communications, Inc.
Visit Paychex.com

Because of new reform and regulatory legislation (health
care, financial services, etc.), we’re facing an avalanche of
new rules and regulations. Which of the changes are the most
significant to accounting and finance
professionals?

REGINA LEE, ADP: “The tax credit for small
businesses resulting from the Patient Protection and Affordable
Care Act and the HIRE Act could have the most significant
effects on accounting professionals this year, and for many
years to come. Not only is there a plethora of new rules to
understand, but also implementation of these rules will take
place over multiple years. In addition, the administration that
is needed to determine client benefits could be onerous and
time-consuming.”

CHARLIE LATHROP, COMPUPAY: “The new regulations
involving employment tax credits will be most significant to
accountants because of the impact to small business. These
credits can be of great value, with an immediate impact to cash
flow in many cases.”

DELBERT HUMENIK, PAYCHEX: “The regulatory
environment is more demanding than ever for accounting and
financial professionals whose job it is to make sure their
clients stay in compliance. Of course, health-care reform
legislation looms large, including the Small Business Tax Credit
available to some businesses; new W-2 reporting rules; and the
expansion of 1099 reporting requirements. New disclosure
requirements for retirement plan fees and auto-IRA legislation
should be top of mind on the retirement side. These are all at
the federal level. At the state level, we expect to see more tax
and regulatory changes in answer to big budget
challenges.”

How does your company’s solution help to cope with the
new rules and regulations?

REGINA LEE, ADP: “ADP acted quickly to the new
regulations, making resources available to help clients
understand these complex laws. We also provided clients and
accounting professionals with reports to help them manage the
changes.”

CHARLIE LATHROP, COMPUPAY: “CompuPay was
proactive in communicating with our clients and partners about
the HIRE Act incentives, developed a HIRE Act savings calculator
located on our company website and completed programming within
our payroll systems to track pay for eligible workers, calculate
the credit and report it on Form 941. We also offered several
HIRE Act and health reform webinars to partners and clients to
help them understand how the new legislation affected their
businesses.”

DELBERT HUMENIK, PAYCHEX: “On the Accounting
Professionals section of our website, we offer free tools such
as our Accountant Knowledge Center, which delivers a wealth of
federal and state resources, as well as a variety of CPE
seminars. We also produce and provide educational webinars – at
no cost – to help educate accounting professionals and employers
about new regulations that impact them. Some of our topics have
included the HIRE Act, health-care reform, and the economic
stimulus package. Last year, Paychex shared its expertise with
over 10,000 accountant participants in CPE seminars.”

There’s quite a debate within accounting firms and
finance departments about whether payroll should be outsourced
or in-sourced. What criteria should be applied to make an
intelligent decision?

REGINA LEE, ADP: “A firm needs to decide if
they want to make payroll a profit center or simply an
accommodation for their clients. Many clients still want their
accountant to handle their payroll because of the trusted
advisor role an accountant plays in their businesses. However,
this is not typically a profitable enterprise for the firm.
Cloud computing and a reliable revenue model can make in-house
payroll an attractive service for accounting
professionals.”

CHARLIE LATHROP, COMPUPAY: “Our accounting
partners find that they can leverage our expertise and still
maintain a level of control over their client’s payroll and
reporting that fits their needs. It really offers a way for our
partners to enhance their relationships with their clients by
conveniently providing yet another essential business
service.”

DELBERT HUMENIK, PAYCHEX: “CPAs and accounting
professionals must be proactive, acting as a trusted advisor to
their clients, identifying those most in need of help – and
offering the right solution, one that is provided by an industry
expert delivering top-quality service. The accounting
professional can then rest assured that their clients are
absolutely going to be taken care of by an end-to-end,
single-source provider with an impeccable
reputation.”

What trends are you seeing in new technologies and
workflows?

REGINA LEE, ADP: “The explosive growth of smart
phones is driving demand for business applications that provide
users with the ability to access and transact information
anytime / anywhere. Small businesses, in particular, can take
advantage of new applications such as ADP’s Run Mobile to run
payroll while on the go.”

CHARLIE LATHROP, COMPUPAY: “Increasingly, we
are seeing a growing acceptance of online and paperless payroll.
Generally, companies with 50 or more employees are also seeking
employee self-service options, manager self service and HRIS
capabilities all integrated with their payroll offering. Expense
management is a new technology that we now offer our clients to
help streamline what is typically a very manual
process.”

DELBERT HUMENIK, PAYCHEX: “Leaders in the
payroll industry are trying to provide a more complete payroll
and HR management solution. They want to identify the “pain
points” in the employee management space and relieve them. The
focus is on integrating the user’s experience – ensuring that
all functions work together and talk with each other. The
integration is executed in a way that supports the natural work
flow. In the past, the applications dictated work flow; now, we
observe how clients are functioning and develop technology that
matches their work flow.”

Looking into the not-too-distant future, what should
accountants and finance managers expect from payroll solutions
vendors in terms of new innovations in service and
technology?

REGINA LEE, ADP: “Cloud computing will come to
dominate the industry. There is no significant cash investment
and back-end software changes can be implemented immediately.
The use of the cloud allows firms to offer more products to
their clients, creating greater revenue and greater loyalty. And
in these uncertain economic times, when clients are shopping
around for less expensive services, offering a broader array of
services makes your firm a more attractive choice. Look for more
mobile apps too. People want to perform business transactions
anywhere and anytime. As an industry leader, ADP will help lead
payroll and HR outsourcing with these and other new
tools.”

CHARLIE LATHROP, COMPUPAY: “For smaller
businesses with simple, automated payrolls, mobile technology
will become more and more prevalent. Payroll, HRIS and time and
attendance offerings will be more integrated and provided as a
single solution for larger employers.”

DELBERT HUMENIK, PAYCHEX: “Innovations will
continue around a simplified user experience that’s Web- and
mobile-based. Accountants, financial managers, and employers are
growing more and more confident doing payroll online – and they
want accessibility from multiple locations. Technology continues
to be exploited to provide more applications to end users, both
employers and employees. The integration of those applications
is essential, and the speed to market for these solutions is
accelerating. Leading providers need to keep pace and respond
accordingly.”

The results of the 2016 presidential election are likely to have a big impact on federal tax policy in the coming years. Eddie Adkins, CPA, a partner in the Washington National Tax Office at Grant Thornton, discusses what parts of the ACA might survive the repeal of most of the law.